Blue Jays, the 2021 CBA, and some off-the-wall ideas

The MLB Collective Bargaining Agreement is due to be renegotiated after the 2021 season.  Both sides have issues.  Might the time be right for some unconventional solutions?

There has been considerable speculation that the upcoming CBA negotiations might be particularly acrimonious. Many players are saying that a strike is inevitable.  It is possible that the strong 2019-20 free agent season (billion-dollar Boras!)  and the coronavirus wake-up call could reduce this feeling of inevitability, but the fact remains that there are issues to be addressed.

So let’s address some of them.

Pre-arb years

Juan Soto of the Nationals put up 4.8 fWAR in 2019 – making him the 22nd most valuable position player in baseball. Jack Flaherty of the Cards finished 4th in last year’s Cy Young voting.  Yet both are making just over the MLB minimum in 2020.  What gives?

Under the current system, players (other than a limited number of “super-twos”) are not eligible for arbitration until their fourth year.  So they make major league minimum-ish, regardless of their performance. So for the first three years, a Juan Soto makes the same as a Gregory Soto.

My solution: Keep the MLB minimum ($563k in 2020) in place, but put in place an arb system for the first three years, with caps. So an exceptional player can earn (say) $1m in his first year, $2m in the second and $3m in the third. They then go to arbitration in the usual manner. The trade-off for owners?  Players agree to eliminate super-twos.

Toronto Blue Jays

Service time manipulation

Under the current system, a player does not become a free agent until he has accrued 6 full years of service time. Teams have been manipulating that rule by only giving a player .9 of a year in his first year.  So at the end of 6 career years, the player only has 5.9 years of service – and has to stay with his team for a 7th year.

My solution: Change the 6 years to something like 5.5 years. That would force teams to keep a Vladdy Guerrero Jr. or Kris Byrant down in the minors for ~3 months to get that 7th year – something that would be hard to justify to the MLBPA and to the fans.

Tanking

From 2012-2015, the Houston Ast … err … Astros drafted first overall three times, and never drafted lower than 5th. They used those picks to take players like Correa and Bregman, who formed the foundation of their World Series winning (cough) team in 2017. The Chicago Cubs had a similar story. These successes have encouraged other teams to adopt the tanking paradigm as a way of signing elite, cheap, young talent.  But 100-loss teams are bad for the game, for the players, and for fans.

My solution: Adopt a draft lottery, like the NHL. The bottom (say) 8 teams enter a lottery to see who drafts first, with the worst team having no guarantee of getting the first pick.  Fangraphs estimates that a #1 overall pick is worth almost double what a #8 is worth ($20m more), but a #16 is worth 70%-ish of what a #8 is.  In the NHL, the team finishing last has only an 18.5% chance of winning the first overall pick.

Underspending

In 2019, the highest payrolls were the Red Sox ($229 million), Yankees ($223m) and Cubs ($222m).  The bottom three were Tampa ($64m), Pittsburgh ($72m) and Baltimore ($73m).  So the bottom three teams – combined – had a lower payroll than any of the top three. And these are the total payroll figures, which include retained payroll and payroll for injured players. Many people feel that it is unfair to the league and to players for teams to fail to compete financially (though it is hard to argue with “cheap” Tampa’s success!)

My solution: Adopt a “penury tax”, similar to the luxury tax except that it is paid by teams whose spending is less than a certain floor.  The spending would be calculated on total costs – not just payroll, but including scouting, minor league players, etc. The “tax” would take the form of making those teams ineligible for revenue sharing or sharing of TV revenues.

Minor league player salaries

Most minor league players make less than $7,500 per season (some much less). Major kudos to the Jays for bucking the system and unilaterally raising minor-league wages, but the problem remains. Some players are lucky – they have earned million-dollar signing bonuses when drafted, or they come from wealthy families. But many players do not have these advantages.

Problem is, many people are less than sympathetic to minor leaguers. They point out that the MiLB players are free to pursue other professions, and that even the MLB minimum salary of $563,000 is 2913% higher than the US minimum wage. And the median 2019 MLB annual salary of $1.5 million is almost as much as the average lifetime earnings of an American with a bachelor’s degree ($1.8m).  These naysayers draw a parallel with young doctors working as interns at below-market salaries because they know that their salaries will increase dramatically when they are licensed to practice. So the idea of just massively increasing MiLB salaries might meet with some opposition.

My solution: First, other MLB teams should follow Toronto’s lead and increase base MiLB salaries.  But this is just a start.  A company called Big League Advance recently introduced a “venture capital” model under which they make a lump-sum payment to a minor league player in exchange for a percentage of his lifetime earnings.

So, for example, they might pay a lump-sum $100,000 in exchange for 1% of lifetime earnings. But they only invest in high-potential players. I would have the owners and MLBPA jointly fund a similar fund for players with a lower upside. The player might get (say) up to $10,000 per year in exchange for 1% of earnings, with a cap on the amount paid under that 1%.  So if a player never makes it to the bigs, he never has to repay this money. But if he does, he effectively funds the next generation of MiLB players.

The bottom line

As a wise old baseball fan once said, “there are many paths to enlightenment“. The solutions I propose above are one way to address the issues that exist, but there are many other (better?) options. The important thing, in my view, is that the issues get addressed somehow.  A strike (or similar stoppage) is in nobody’s best interest.